Bitcoin is proving its shortcomings as a safe haven amid the current global market meltdown.
The price of the largest digital currency continued to swing wildly in Asia Friday as a rout that began in earnest overnight in New York showed no signs of slowing down. Bitcoin dropped as much as 32% to $3,915, its weakest since March 2019, before clawing back most of that loss by midday in Hong Kong, according to consolidated pricing compiled by Bloomberg. Its drop of as much as 50% over the past two days is among the biggest ever.
Bitcoin was down 7.8% to $5,280 as of 12:25 p.m. in Hong Kong.
The wider Bloomberg Galaxy Crypto Index tracking a basket of digital assets hit a historic low in data going back to August 2017, sliding as much as 49% over the two sessions. Rival token Ether briefly flipped positive to reverse an earlier 30% loss, while XRP pared declines.
“This sell-off has caused cascading margin calls with the vast majority of investors shifting to exposure to cash,” said Wayne Trench, chief executive of digital asset brokerage and exchange operator OSL. “In this situation, correlation converges to 1 and even impacts potential ‘safe havens’ like gold and Bitcoin to varying extents.”
Global markets have been rocked in recent weeks by an escalating number of macro headwinds, from the intensifying coronavirus outbreak to a shock plunge in oil prices. President Donald Trump’s address to the nation Wednesday, which included curbs on most travel to Europe and unspecified relief spending, spurred further selling in equity markets around the world with the S&P 500 sinking the most since 1987 on Thursday.
“What do you want, cash or Bitcoin?” said Stephen Innes, chief Asia market strategist at Axicorp. “Obviously I want cash.”
Bitcoin is now down about 50% from its most recent February high. The crypto had been on the upswing this year to that point, as investors looked ahead to the so-called “halvening” -- a scheduled reduction in the Bitcoin mining rate designed to combat price inflation.
“Traders are pulling money out of Bitcoin to fund their margin calls on other asset classes,” said Ross Middleton, chief financial officer at crypto exchange DeversiFi. “Perhaps they think that there will be better short-term opportunities to go long other asset classes in the near future.”
The new regional leader brings nearly 25 years of experience as the firm seeks to tap a complex and evolving market.
The latest updates to its recordkeeping platform, including a solution originally developed for one large 20,000-advisor client, take aim at the small to medium-sized business space.
David Lau, founder and CEO of DPL Financial Partners, explains how the RIA boom and product innovation has fueled a slow-burn growth story in annuities.
Crypto investor argues the federal agency's probe, upheld by a federal appeals court, would "strip millions of Americans of meaningful privacy protections."
Meanwhile in Chicago, the wirehouse also lost another $454 million team as a group of defectors moved to Wells Fargo.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
